Maintain long positions. The WTI Crude extended its advancement into a fourth consecutive session after it broke out from its minor congestion area early in the week. The black gold reached a high of USD48.59 – a level not too far from the USD48.66 immediate resistance – before scaling back its gains to settle USD0.54 higher at USD48.36. While not able to close above the aforementioned immediate resistance, the intraday price actions did not show any price rejections. Instead, chances are high that the commodity is merely experiencing a minor pause. The positive performance also pushed the RSI further into overbought territory. Based on the recent price actions, provided the USD47.20 support level is not breached, our positive trading bias should stay valid.

We recommend traders stay in long positions. We initiated these at USD47.62, which was the closing level of 15 Dec. To manage risks, a stop-loss can be placed below the USD47.20 threshold.

The immediate support is revised to USD47.20 and followed by USD46.50, which was near 15 Dec’s low. Conversely, the immediate resistance is set at USD48.66, or the high of 3 Mar, and followed by the USD50.00 round figure

Source: RHB Securities Research - 18 Dec 2020